Analyst Update: LinkedIn, Dendreon Corp, Clorox

Analysts offered their two cents on LNKD, DNDN, and CLX

Nov 3, 2014 at 2:06 PM
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U.S. stocks are sticking close to breakeven at midday, as Wall Street weighs a mixed batch of economic reports. Among equities attracting the attention of analysts are professional networking site LinkedIn Corp (NYSE:LNKD), biotech issue Dendreon Corporation (NASDAQ:DNDN), and household chemical maker The Clorox Co (NYSE:CLX).

  • LNKD is flirting with a 2.2% lead at $234.04, after Monness Crespi Hardt initiated coverage with a "buy" rating and a $270 price target -- representing expected upside (and a new record high) of 15.4% to the stock's current perch. (The brokerage firm wasn't so kind to sector peer Twitter Inc.) On the charts, LNKD has added more than 8% year-to-date, climbing back into the black in the wake of a stellar earnings showing late last week. While most analysts are already in the bulls' corner -- LinkedIn Corp sports 19 "buy" or better ratings, compared to nine "holds" and zero "sells" -- a short-squeeze situation or a reversal in sentiment in the options pits could add fuel to the equity's fire. On the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day put/call volume ratio of 1.03 is docked in the bearishly skewed 87th annual percentile, and short interest accounts for nearly a week's worth of pent-up buying demand, at LNKD's average pace of trading.

  • DNDN is up 3.1% at $1.01, after an analyst at Credit Suisse initiated coverage with a "neutral" rating and $1.50 price target. Still, DNDN has surrendered two-thirds of its value year-to-date, and has underperformed the broader S&P 500 Index (SPX) by nearly 54 percentage points during the past three months. Against this backdrop, short sellers have been upping the bearish ante, and these pessimistic positions now account for more than one-fifth of DNDN's total available float. In fact, it would take nearly three weeks to buy back these bearish bets, at Dendreon Corporation's average daily trading volume. Meanwhile, most analysts are -- unsurprisingly -- skeptical of DNDN, as not one of the 11 brokerage firms following the shares deems them worthy of a "buy." Off the charts, DNDN is tentatively due to report third-quarter earnings sometime next week.

  • Finally, after tagging a record high of $100.47 earlier, CLX has retreated into double-digit territory, down 0.3% at $99.17. The equity on Friday skimmed the century mark for the first time ever, thanks to a well-received earnings report, and today's turnaround comes in the face of post-earnings price-target hikes from no fewer than six brokerage firms. Plus, B. Riley upgraded CLX to "neutral" from "sell," citing "potentially strong demand for CLX's disinfecting products … due to concerns over enterovirus and Ebola." There's still plenty of room on the bullish bandwagon, too, as The Clorox Co's average price target of $88.20 represents a discount to the equity's current price, and just one out of 11 analysts considers the stock a "strong buy."
 

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